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Old 09-09-2009, 10:38 AM
Tom Hildebrandt Tom Hildebrandt is offline
 
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Default USPAP Difference between assumption and opinion

In the idle moments over the past several years, when I have thought about USPAP, I have wondered about what the real difference is between an opinion and an assumption.

Since I am living a life away from appraising now and am living on a sail boat, these discussions have been without the benifit of any input from others, so I keep going in circles!

One chain of thought, is not an an opinion of value just the end result of assumptions about the market?

Another is that an assumption is just simply an opinion in its own right.

I never took logic in college, far too difficult a topic for someone who was more interested in playing than studying, so some insight from fellow forumites would be appreciated.

Regards


Tom
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Old 09-09-2009, 10:42 AM
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I was taught that an opinion is a conclusion based on fact. While an assumption includes unknowns.
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Old 09-09-2009, 10:53 AM
DWiley DWiley is offline
 
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An opinion is a view or a judgment. The opinions expressed by appraisers are supposed to be based on facts, but in general, opinions may or may not be based on facts. For example, some hold the opinion that certain colors are more pleasing than others. (i.e. my favorite color is...)

An assumption is something taken to be true. Disclosing an assumption is not expressing an opinion. For example, if one makes an assumption that the zoning for a property will be changed, that does not neceesarily mean that the appraiser's opinion is that the zoning will be changed.
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Old 09-09-2009, 10:55 AM
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In appraisal theory, an assumption does not have to have a limiting factor. That would be an extraordinary assumption if it has a limiting factor. Assumption as defined in USPAP in the vdefintions is that whic is taken to be true. An opinion opinion is not defined in USPAP. However, Websters 2nd College Edition states that it is a belief not based on absolute certainty or positive knowledge but what seems to be true, valid, or probable to one's own mind.
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Old 09-09-2009, 10:57 AM
Tom Hildebrandt Tom Hildebrandt is offline
 
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Yes, but the reality of appraising is that the value conclusion we reach is not truly based on facts, it is our assumptions (or is it opinion) about what we believe the facts to be. For example, even deciding what are relevant physical property characteristics is a matter of often widely divergent opinion, essentilally our assumptions about how buyers and sellers view those items.
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Old 09-09-2009, 11:00 AM
Tom Hildebrandt Tom Hildebrandt is offline
 
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One definition of an opinion is a belief or idea, held to be true, but which can not be proved to be false. That strikes me as very close to the definiton of an assumption just tendered.
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Old 09-09-2009, 12:59 PM
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Francois K. Gregoire Francois K. Gregoire is offline
 
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Although I don't have any comment on your question, I do want to take this opportunity to say HI. It's good to see you here after all this time.
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Old 09-09-2009, 01:10 PM
Tom Hildebrandt Tom Hildebrandt is offline
 
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Hi Frank

Gosh, this is like a high school reunion! I take it your are no longer a serving board member in Florida, What else is new in your world?

Tom
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Old 09-09-2009, 01:19 PM
Denis DeSaix Denis DeSaix is offline
 
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Quote:
Originally Posted by Tom Hildebrandt View Post
In the idle moments over the past several years, when I have thought about USPAP, I have wondered about what the real difference is between an opinion and an assumption.
Speaking philosophically, there might not be much of a difference.
Speaking USPAP, there is a specific process which needs to be followed in order to form an appraisal opinion.
The process of assuming something is not the same as the process for forming an appraisal opinion.
  #10  
Old 09-09-2009, 01:34 PM
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We can only assume that our opinions are right. They can change from day to day. I think that one word (opinion) weakens our profession.
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